Jobless Rate Levels Off In This Area

January 05, 1991|By DAVID RESS Staff Writer

The number of people out of work is surging in the United States and Virginia. But in Hampton Roads, hit hard by the Desert Shield mobilization, the worst seems to be over, according to federal and state reports released Friday.

The U.S. Labor Department said Friday that the national unemployment rate jumped to 6.1 percent in December - the highest rate in three years. It had been 5.9 percent in November.

The rate's rise from 5.3 percent in June is the fastest in eight years and means more than 1 million people lost jobs in the last six months.

Virginia's unemployment rate jumped to 4.5 percent in November from 4.2 percent the month before, as the number of people out of work climbed from 135,400 to 144,900, the Virginia Employment Commission said.

Commission economist William F. Mezger forecast that the December rate would rise to 4.6 percent.

The sharp unemployment rises in November and December - times when businesses usually hire workers for the Christmas shopping season - "show we're definitely in a recession ... and it's going to be a real zinger," said Carl Colonna, an economics professor at Christopher Newport College.

White House spokesman Marlin Fitzwater told reporters that the rise in unemployment was "very difficult and troubling information," adding: "We are hopeful that the drop of interest rates and controls on federal spending will allow this to be a short-lived recession. But no one can say for sure."

Hampton Roads' unemployment rate was steady at 4.2 percent in November while the number of people out of work rose by just 10 to 26,730, according to the VEC.

While the local economy has been hurt because the Desert Shield mobilization has taken roughly 40,000 local service men and women out of the area, Mezger said he thought most of the jobs that were at risk have already been lost.

"Most of the job losses came in August, September and October," he said. "Hampton Roads seems to have stabilized."

The biggest losses following the Desert Shield mobilization came in retailing.

Many of the military personnel now in the Middle East had held part-time jobs in Hampton Roads; their departure also cut sales for some stores, prompting layoffs.

In November, Hampton Roads retailers hired 2,500 people for the Christmas sales season, but retailing employment was still down by 2,100 from November 1989.

Service companies let 1,400 people go in November. Mezger said most of this decline reflected the seasonal slowdown for hotels and tourist-oriented businesses.

Construction employment fell by 300 over the month and 2,200 over the year, to 36,100. But the 5.7-percent slump in Hampton Roads over the 12-month period was significantly smaller than the statewide 6.5-percent decline, Mezger said.

Employment at transportation equipment companies, which includes shipyards, rose to 35,500 - an increase of 600 over the month and 1,300 over the year.

Most of the gains came at Newport News Shipbuilding, the state's largest private employer, Mezger said.

In all, 592,800 people in Hampton Roads had jobs in November, up by 500 from October but down 300 from the November 1989 level.

Across Virginia, 2,939,600 people had jobs in November, the highest total since June. Employment was up 3,300 from the October level.

But the gains were mainly due to Christmas-season hiring, Mezger said.

Even more people started looking for work in November than companies hired, pushing the unemployment rate up.

Across the United States, job losses totaled 263,000 in December, boosting the number of unemployed Americans by 300,000 to 7.6 million in November, the U.S. Labor Department said.

Total civilian employment rose less rapidly, to about 117.6 million in December from 117.4 million in November.

The number of discouraged workers - people who want to work but have given up looking for jobs - rose by 110,000 in the final quarter of 1990 to 940,000, the highest level since 1988, the Labor Department said.

Discouraged workers are not counted in the 6.1 percent national unemployment rate.

Black teenagers had the worst unemployment rate - 35.6 percent. But that was an improvement from the previous month's rate of 37.5 percent.

Factory payrolls fell by 33,000 during the month and nearly 600,000 over the year, despite the return during the month of 20,000 auto workers from temporary layoffs.

There was still more bad news from manufacturers: in a separate report today, the Commerce Department said orders to U.S. factories fell 5.9 percent in November, the largest one-month plunge on record.

Construction employment fell by 28,000 jobs in December and by nearly 300,000 over the year, while jobs in the service sector fell by 21,000 over the month.

Health services jobs rose by 56,000.

The department said labor costs rose sharply in December, jumping to $10.20 an hour, a 0.6percent increase over the $10.14 the average hourly worker earned in November.